In a note to clients late Friday, Goldman Sachs Chief Economist Jan Hatzius argues that incremental deterioration in China should have littel impact on the developed, western world.

"If China does slow more seriously, how big are the spillovers to DM growth?" Hatzius asks. "Probably not very big. The reason is illustrated in Exhibit 1, which plots exports to China, as well as more broadly to Asia ex-Japan, as a share of GDP. With the exception of Australia, Japan, and Germany, all of the China numbers are around 1%. This means that even if Chinese import volumes were to decline by 10% across the board due to a combination of Chinese domestic demand weakness and CNY depreciation—a very severe assumption—this would only take 0.1 percentage points off DM GDP growth directly."